Submission regarding the Social Security Legislation Amendment (Public Housing Tenants’ Support) Bill 2013
The North Australian Aboriginal Justice Agency (NAAJA) welcomes the opportunity to make the following comments on the Social Security Legislation Amendment (Public Housing Tenants’ Support) Bill 2013.
We are concerned about the short time frame to provide comments. The exposure drafts became available on 11 April 2013 and we have been required to provide comments within 8 business days. We have had to divert resources away from our vulnerable Aboriginal clients in order to meet this deadline. We are also concerned that the short timeframe will affect the quality of the consultation.
Summary
NAAJA is opposed to theintroduction of the proposed Housing Payment Deduction Scheme (Scheme).
There are adequate mechanisms in existence to reduce the risk of public housing tenants who receive Centrelink payments being evicted for rent arrears –use of Centrepay deductions, the funding of tenancy support programs, and the use of the notice provisions of the Residential Tenancies Act (NT) 1999 or equivalent.
We are deeply concerned that the Scheme will be used to collect unproven and unsubstantiated debts by public housing lessors, and undermine the legislated inalienability of social security payments. It will place a significant degree of control in the hands of public housing lessors.
Given the unreliability of existing mechanisms to establish rent deductions from Centrelink payments in both the remote and urban public housing context in the Northern Territory, NAAJA has grave concerns about the proposed Scheme imposing compulsory deductions.
We are further concerned about the dispute resolution mechanisms available for public housing tenants made subject to the proposed Scheme. In the Northern Territory, the Territory Housing Appeals Board which reviews decisions of Territory Housing has no statutory basis or binding powers and there is no administrative review mechanism in the NT, bar the original jurisdiction of the Supreme Court. This will mean that decisions by public housing lessors cannot be meaningfully reviewed.
Responsibility for the efficient management of public housing is the province of State and Territory governments; if inefficiencies are present, the responsibility for redressing these should not be born by vulnerable tenants.
If the proposal is introduced, the Bill and legislative instruments require significant amendment to ensure basic levels of fairness and accountability for public housing tenants who receive Centrelink payments.
Whilst being opposed to the introduction of the Scheme, we make the following recommendations:
a)the proposed Scheme should not be applied to remote tenants until the Commonwealth Ombudsman is satisfied that the issues identified in the 2012 Remote Housing Reforms in the Northern Territory report have been satisfactorily dealt with;
b)that proposed section 123YA(2A) which enables public housing lessors to make unilateral decisions to control the proportion of a person’s income managed funds be abandoned;
c)that if proposed section 123YA(2A) is retained, that it be explicit that the Secretary must take account of the person’s current income management deduction and broader financial circumstances prior to taking action to facilitate payment indicated by the request;
d)that public housing lessors be unable to collect debts from income managed funds;
e)the minimum for rent arrears be equivalent to two weeks rent for the premises and this be specified in the legislation;
f)the minimum for debt recovery be set at $1000;
g)If the notice relates to current rent arrears, reasonable action should be defined in the legislation as:
the public housing lessor has taken recovery action in a Court or Tribunal and rent is found to be payable to the public housing lessor under the terms of the current lease
If the above recommendation is not accepted:
the public housing lessor has served a notice to the person under the relevant law which relates to the arrears, which includes a notification that the public housing lessor intends on making a request to the Secretary; the public housing lessor has offered to enter into a payment plan to address the arrears; 30 days has elapsed since the issue of the notice and the offer to enter into a payment plan; the notice details the person’s right to appeal and how to do so; and the arrears are still in existence and the person has not entered into a payment plan when the notice is given to the Secretary.
h)If the notice relates to outstanding debt or debts for repairs and maintenance reasonable action should be defined in the legislation as:
the public housing lessor has obtained orders in the relevant Court or Tribunal that the amount is proven and payable by the tenant named in the notice.
i)that ‘become payable’ be removed from Part 2, Clause 5(1)(b); the Scheme should only apply to people in rent arrears on the date that a request to the Secretary is made;
j)that Part 2, clause 5(5) be amended to include:
The request must contain a statutory declaration signed and dated by the public housing lessor that:
(a)there is a current written tenancy agreement with the person named in the notice;
(b)the amount of rent payable under the rent agreement is specified on the tenancy agreement;
(c)the rent is in arrears of more than 14 days at the date the request is made;
(d)the public housing lessor can produce a statement of rent which evidences the arrears; and
(e)the public housing lessor has taken reasonable action to recover the amount.
In addition, the Secretary should be empowered to request the public housing lessor to provide substantiation of the above declaration. If that substantiation is not provided within a reasonable time, that the Secretary can revoke the request;
k)that the request be in the form of a statutory declaration, attesting to the information referred to in the above recommendation;
l)That Part 2, Clause 6(2) be amended to include:
The Secretary must not make a deduction if there is a genuine dispute regarding the basis of the request.
The Secretary not make a deduction if upon examination of the person’s full financial circumstances, including existing Centrepay deductions, the person would be in financial hardship if the deduction were made.
m)the maximum deduction amount of deduction in Part 2, Clause 7(1)(c) be set at 20% to reduce the likelihood that deduction will lead to financial hardship;
n)that Part 2, Clause 8 be amended to state:
When a request is to be amended:
A request will be amended by the Secretary upon notice from the public housing lessor that a lessor amount is payable, or if the Secretary is advised of the outcome of a dispute where the person is required to pay a lessor amount or is otherwise advised the amount is no longer payable for any reason.
o)that Part 2, Clause 8 (4) be amended to state:
The public housing lessor must as soon as practicable give notice to the Secretary that a lesser amount is payable than the amount on the request
p)That Part 3, Clause 10 be amended to read ‘may’ instead of must;
q)that part 4, Clause 13 (1)(B) be amended to read ‘or a lower amount identified by the Secretary’;
r)that the Bill be amended to include a prohibition on public housing lessors passing the cost of the proposed Scheme onto public housing tenants, by way of rent increases, ongoing charges or any other manner;
s)the definition of tenant be included in the legislation and amended to read ‘means a person who is named on a written lease or tenancy agreement under the relevant residential tenancies legislation from a public housing lessor’
t)if the Rule is not abandoned, Rule 4(1) be amended to remove ‘an amount due’ and insert ‘amount found payable by Court or Tribunal’;
u)if the ‘at risk’ rule is not abandoned, the rules be amended to state that public housing lessors cannot refer to tenant databases when determining a person is at risk under clause 4(2) of the proposed rules;
v)if the Rule is not abandoned, ‘non renewal of lease’ should be removed from Rule 4(2);
w)if the Rule is not abandoned, abandonment should be removed from Rule 4(2); and
x)if the Rule is not abandoned, existing Rule 4(3) should be deleted and be substituted to require that the person be in arrears of rent for at least 14 days at the time the notice is given.
- About NAAJA
NAAJA provides high quality and culturally appropriate legal aid services for Aboriginal people in the Northern region of the Northern Territory in the areas of criminal, civil and family law. In addition to providing legal services, NAAJA is also active in advocacy and law reform in relation to issues impacting upon the legal rights of Aboriginal people and their ability to access justice.
We have offices in Darwin, Katherine and Nhulunbuy. We employ a staff of over 90 people including 38 lawyers, with 46 per cent of our staff being Aboriginal.
NAAJA has four welfare rights lawyers undertaking the Welfare Rights Outreach Project (WROP). The WROP encompasses casework, community legal education and law and policy reform on welfare rights issues, specifically Centrelink and income management, remote housing and consumer law. The welfare rights lawyers travel regularly to remote Aboriginal communities across the Northern Region of the Northern Territory to conduct advice clinics.
The welfare rights team at NAAJA leads advocacy and policy reform around remote housing issues in the Northern Territory and are particularly well placed to comment on this Scheme as a large proportion of our case work and policy relates to Territory Housing, the public housing lessor in the NT.
- The Northern Territory context
We provide the following information about the Northern Territory as background to our comments and recommendations.
Around 100 languages are spoken in the Northern Territory with many people speaking English as their third or fourth language. [1]
Territory Housing is the largest landlord in the Northern Territory and holds 5236 urban, 621 town camp and 6924 remote assets. Territory Housing has estimated around 75% of its remote tenants pay rent via Centrelink and 25% pay rent from wages from employment.[2]
There are approximately 48 000 people on Centrelink benefits in the NT.[3] Of these, approximately 17 000 are income managed.By virtue of Part 3B of the Social Security (Administration) Act 1999, 50% of the Centrelink payments of people under income management is paid into their bank account and the other 50% of their payment is put into a Centrelink administered account to spend on their ‘priority needs’.[4] The person can allocate their income managed funds to a BasicsCard, which can be used at retailers with BasicsCard merchant status and/or authorise Centrelink to make direct payments to third partieson their behalf, for example to purchase priority goods or make payments to a telephone company or a utilities company.
- General comments
3.1Inalienability of social security payment
We consider that the proposed Scheme grossly undermines the inalienability of social security payments as explicitly recognised by section 60 of the Social Security (Administration) Act 1999, which states:
‘Protection of social security payment: A social security payment is absolutely inalienable, whether by way of, or in consequence of, sale, assignment, charge, execution, bankruptcy or otherwise.’
The only legislated exceptions to this are if the person asks the Secretary to make a deduction from their social security payment to pay the Commissioner of Taxation, payments made under income management and child support payments.[5]
Debt collectors are unable to access a person’s social security payment for payment. We consider that public housing lessors should similarly be denied access, particularly for payments of debts relating to previous tenancies.
Sufficient means are available for public housing lessors to prove, recover and enforce debts. We consider that this fundamental principal should not be violated; the present proposal turns the payment of social security to vulnerable members of the community, into a mechanism for debt collection.
3.2The aims of the Scheme
We understand that the proposed Scheme is intended to:
- Reduce the level of public housing arrears and debt that can be accumulated;
- Reduce evictions and abandonments from public housing;
- Make management of public housing more efficient.[6]
3.2.1Sufficient means exist to reduce arrears and debt
NAAJA considers that Territory Housing has sufficient means to address rent arrears and debt accumulation.
Territory Housing requires its tenants on Centrelink benefits to authorise Centrelink to deduct the rent from their Centrelink payment.[7] This is a term of the Territory Housing’s standard tenancy agreement. The tenancy agreement prohibits the tenant from revoking the authority and allows Territory Housing to notify Centrelink of any increase in the rent payable.
The tenancy agreement further requires the tenant to ‘immediately’ notify Territory Housing ‘if Centrelink discontinues payment of Centrelink Benefits to the Tenant’[8]
After 14 days of the tenant being in rent arrears, Territory Housing can issue a notice of breach pursuant to section 96A of the Residential Tenancies Act, requiring the tenant to remedy the breach by paying rent. It can also contact the client to request the tenant to enter an agreement to pay.[9]
Territory Housing also addresses outstanding rent arrears and debt accumulation through its eligibility policies. Territory Housing does not allow people with outstanding debts to apply for housing until they have maintained three months of payments under an agreement to repay.[10]
Generally, Territory Housing will not allocate a house to a person with an existing debt ‘until the full amount has been repaid’.[11] Discretion to allocate a house, where there is existing debt will only occur
‘in the cases of exceptional need eg severe physical and/or mental disability or immediate need in relation to people escaping domestic or family violence’.[12]
We do not consider the proposed Scheme to be necessary to reduce the level of public housing arrears and debt.
We are further concerned that the Scheme will be used by public housing lessors to collect debts which are unproven and have not been subject to review.
3.2.2Reducing evictions and abandonments requires support programs
FaHCSIA Fact Sheet 1[13]states that each year 600 public housing tenants are evicted because of rent arrears. One of the assumptions underlying the proposed Scheme is that those evicted are wholly or predominantly Centrelink recipients.It is not clear what proportion of those evicted for rent arrears are people employed on low incomes and are therefore outside the Scheme.
At NAAJA we do not see many evictions from public housing for rent arrears – our experience is that evictions are pursued when there are allegations of anti-social behaviour, and/or damage to premises. Most of the abandonments we see are related to domestic violence. This Scheme will not assist these tenants who require the assistance of properly funded tenancy support programs and other forms of social support.
3.2.3Inappropriate burden on Centrelink recipients to make public housing more efficient
The efficient management of public housing should not rely on the compulsory deduction of a person’s Centrelink payment.
Whilst NAAJA support sustainable approaches to assist vulnerable tenants to prevent homelessness, there is no guarantee that the Scheme will have the effect of reducing the relatively small number of evictions for rent arrears compared to the amount of public housing tenants in Australia in a cost effective manner.
It is unclear what the cost to benefit of the Schemeis and how the cost is to be shared between the Commonwealth and State/Territory Governments. It is also unclear what steps the Commonwealth has taken in conjunction with the States and Territories to develop workable alternative policies that address evictions through case management approaches.
3.2.4Scheme to be used as a debt collection method for unproven, old debts
We are deeply concerned that public housing lessors will use the proposed Scheme to recover debts from previous tenancies, which are unproven in the Commissioner of Tenancies or otherwise not substantiated with clear evidence.
We note that in contrast to other jurisdictions, Territory Housing makes it a term of its tenancy agreement that the tenant pay all outstanding debt owed to it from any previous tenancy agreement or ‘any previous dealings whatsoever’:
‘2.6It is a condition of this Agreement that the Tenant pay all outstanding debt which is owed to the Landlord which has arisen from any previous tenancy agreements or any previous dealings whatsoever, on such terms as the Landlord specifies in writing to the Tenant.
Without limitation, the Tenant and Landlord further agree that the Landlord may terminate this Lease for breach in accordance with the RTA, if the Tenant breaches its obligations under this clause 2.6.’[14]
NAAJA is assisting a number of clients in dispute with Territory Housing relating to alleged debts from previous tenancies. There is no limitation on actions by the Crown for the ‘recovery of a fee, tax, duty or other sum of money or interest on a fee, tax, duty or other sum of money…’.[15]
This allows Territory Housing to insist on debts related to tenancies which ended many years before. In the majority of cases NAAJA sees, Territory Housing does not prove the debts by making a timely application to the Commissioner of Tenancies.